Not so long ago, if you were a Sears customer, you’d probably frequent a specific location, and the clerk behind the counter often knew what you wanted before you asked. Those days are long gone, forcing some significant adjustments in how Sears reaches out to its clientele. The recent changes at Sears and parent company Sears Holdings weren’t about marketing strategy, though—they were about the methods involved in deploying that strategy. And when the nation’s fourth-largest retailer decides to make a shift in marketing, the industry tends to notice.
In addition to approximately 3,900 full-line and specialty retail stores in the United States and Canada, Sears Holdings is also the nation’s largest provider of home services, with more than 12 million service calls made annually. Overall, the company generated more than $46 billion in revenue in 2009, according to CNN.com. A company that once prided itself on customer knowledge, Sears was grasping for a way to capture information from all those transactions, so that it could market to its consumers as intelligently as it always had.
Until October of last year, says Tony Arnold, director of CRM at Sears Holdings, the company relied on an army of database experts for the arduous task of pulling customer information out of a data warehouse, developing segmentation, and performing suppression. Code reuse was extremely difficult, as was developing any type of campaign history. Also, because each of Sears’ 33 business units marketed within its own silo, the company was running 33 different email-marketing campaigns. Some customers received 400 emails a month.
Arnold says Sears decided an easy-to-use platform was the best way to counteract the company’s difficult business process. “We needed the ability to use code, to understand the history of customer-contact strategies, and to understand how and when we were contacting these customers,” he recalls. “[We wanted to] bring the need for very experienced [programmers] down to a less-expensive level to push out a high volume of campaigns.”
With several goals in mind—to better understand customer behavior, provide targeted email marketing, perform contact management control, and execute basic reporting—Sears eventually chose enterprise management marketing software from Unica, which showed an ability to handle the company’s ever-growing volume of information. Unica also generated visible code that could be hand-edited, which allowed it to integrate well with other platforms. “For what was available on the market, its capabilities, and the need that Sears had,” Arnold says, “Unica was the best value.” (Unica has since been acquired by IBM.)
With Unica’s support, Sears developed an email opt-in preference center for collecting customer information. The goal was to deliver better marketing materials—offers that were more relevant and better targeted—through an improved understanding of the customer, such as what products she buys each year, when she likes to receive offers, what size shoe she wears, etc. “The guy behind the counter in the old Sears shop knew that kind of stuff,” Arnold says. “I’m trying to get us to a point where we’re communicating with our customers in the same way.”
While nothing may ever be as simple as face-to-face communication, Unica’s platform made Sears’ communication efforts easier and much more efficient. In the first six months after the October launch, Sears Holdings initiated 726 marketing campaigns, 689 of them via email. Averaging 63 campaigns a week—a tremendous increase compared to the four or five per week before—the company made 4 billion customer contacts, and 100 million trigger-driven contacts. Less than one percent of the marketing campaigns were late and, despite the sharp increase in outreach, the campaigns suffered not a single production error.
Arnold claims the new strategy pushed the company 3,000 percent beyond its original scope, and, as of May, email volume had increased an average of 50 percent month over month. “We’re way over what we purchased the system to handle,” he explains. “We originally wanted to push out 36 campaigns per month. We’re at 240 campaigns per month and we’re growing every single month.”
So what’s next for a successful retail giant with a newly solidified strategy for marketing automation? Social media, of course. Arnold says that Sears Holdings is now looking to use Unica to drive social network initiatives. The company wants to further enhance the relevance of its advertising by listening to what customers are saying on sites such as Facebook and Twitter.
“We have to understand what the customers are commenting on,” Arnold explains. “Knowing what the customers want is what CRM systems are built for.”
Since implementing Unica’s enterprise marketing management, Sears Holdings has:
- launched 726 marketing campaigns—an average of 63 per week, up from five—and more than 99 percent of them on time;
- attained 100 million trigger-driven contacts;
- gained 4 billion customer contacts, an average of 114 million a week;
- suffered zero production errors; and
- seen the volume of outbound emails grow 50 percent month over month.